Correlation Between Amkor Technology and Universal Insurance
Can any of the company-specific risk be diversified away by investing in both Amkor Technology and Universal Insurance at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Amkor Technology and Universal Insurance into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Amkor Technology and Universal Insurance Holdings, you can compare the effects of market volatilities on Amkor Technology and Universal Insurance and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Amkor Technology with a short position of Universal Insurance. Check out your portfolio center. Please also check ongoing floating volatility patterns of Amkor Technology and Universal Insurance.
Diversification Opportunities for Amkor Technology and Universal Insurance
-0.39 | Correlation Coefficient |
Very good diversification
The 3 months correlation between Amkor and Universal is -0.39. Overlapping area represents the amount of risk that can be diversified away by holding Amkor Technology and Universal Insurance Holdings in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Universal Insurance and Amkor Technology is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Amkor Technology are associated (or correlated) with Universal Insurance. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Universal Insurance has no effect on the direction of Amkor Technology i.e., Amkor Technology and Universal Insurance go up and down completely randomly.
Pair Corralation between Amkor Technology and Universal Insurance
Assuming the 90 days horizon Amkor Technology is expected to under-perform the Universal Insurance. But the stock apears to be less risky and, when comparing its historical volatility, Amkor Technology is 1.38 times less risky than Universal Insurance. The stock trades about -0.09 of its potential returns per unit of risk. The Universal Insurance Holdings is currently generating about 0.07 of returns per unit of risk over similar time horizon. If you would invest 1,980 in Universal Insurance Holdings on August 28, 2024 and sell it today you would earn a total of 160.00 from holding Universal Insurance Holdings or generate 8.08% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Against |
| Strength | Insignificant |
| Accuracy | 100.0% |
| Values | Daily Returns |
Amkor Technology vs. Universal Insurance Holdings
Performance |
| Timeline |
| Amkor Technology |
| Universal Insurance |
Amkor Technology and Universal Insurance Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Amkor Technology and Universal Insurance
The main advantage of trading using opposite Amkor Technology and Universal Insurance positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Amkor Technology position performs unexpectedly, Universal Insurance can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Universal Insurance will offset losses from the drop in Universal Insurance's long position.| Amkor Technology vs. NVIDIA | Amkor Technology vs. NVIDIA | Amkor Technology vs. QUALCOMM Incorporated | Amkor Technology vs. Intel |
| Universal Insurance vs. Algonquin Power Utilities | Universal Insurance vs. BE Semiconductor Industries | Universal Insurance vs. NORTHEAST UTILITIES | Universal Insurance vs. SERI INDUSTRIAL EO |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Crypto Correlations module to use cryptocurrency correlation module to diversify your cryptocurrency portfolio across multiple coins.
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